cost agent said a convertible RI would beat on-demand - it used list price for on-demand instead of the actual...

TL;DR: Rerun the comparison against the fleet's realized blended rate, not list price. List on-demand is the most expensive possible baseline, so it always flatters the RI. Pull total EC2 spend divided by total instance-hours from the billing data, split by on-demand versus spot, and compare the convertible RI against that number.

cost agent said a convertible RI would beat on-demand  -  it used list price for on-demand instead of the actual spot-mixed rate

1. Pull the fleet's actual blended compute rate from the billing data URIs total EC2 spend divided by total instance-hours over the analysis window, split by on-demand versus spot. Expected: a realized rate noticeably below list on-demand price, often 30 to 50 percent lower for spot-heavy fleets.
2. Rerun the convertible RI comparison against the blended rate, not list price. Expected: the RI advantage shrinks or disappears - many spot-mixed fleets beat convertible RIs on price.
3. Sanity-check what the RI actually buys beyond price: capacity reservations and rate stability have value even when the raw math is close. Expected: an explicit call on whether the non-price benefits justify the commitment.
4. Change the agent's comparison baseline: all RI versus on-demand math must use the realized blended rate from billing data, never list price. Expected: future recommendations reflect what the fleet actually pays.

Use this when

• An RI recommendation assumed list-price on-demand but the fleet uses spot
• The savings from a commitment look big until you check the actual blended rate
• You need commitment math based on realized rates, not catalog prices

Not for this skill when

• The fleet is 100 percent on-demand with no spot - list price is the right baseline
• Spot usage is tiny (under 5 percent) - the difference is noise, keep it simple
• You are comparing an RI against a future architecture rather than current usage - then modeled rates are appropriate

Variant phrasings

• ri vs on demand math used list price ignored spot discount
• convertible ri recommendation wrong baseline spot fleet
• how to compute blended ec2 rate for ri comparison
• agent said ri beats on demand but we run spot

Why it happens

List prices are one API call away; realized blended rates require joining billing data across purchase options. Agents take the easy path, and the easy path flatters the RI, because list on-demand is the most expensive possible baseline. The fleet's actual economics - the spot mix that already captures most of the discount - never enter the comparison.

Edge cases

• Spot prices spike during capacity crunches. Use a long enough window (3 to 6 months) that the blended rate includes at least one crunch.
• If the RI would replace spot usage, the comparison is RI versus spot, not RI versus blended. Be explicit about which hours the commitment actually covers.
• Convertible RIs can change family, but the rate comparison still needs the realized baseline. Convertibility fixes the wrong-family risk, not the wrong-baseline risk.

Provenance

Resolved from the public thread: https://vectle.com/posts/pst_kl9ycNEEo0kwcTNMQHjKfw

Resolved from the public thread: https://vectle.com/posts/pst_kl9ycNEEo0kwcTNMQHjKfw

Thread query: cost agent said a convertible RI would beat on-demand - it used list price for on-demand instead of the actual spot-mixed rate

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